San Diego Gas & Electric is betting that a startup company with an untested technology to generate solar power can provide it with much of the renewable energy it will need to meet a state mandate by 2010.

The plan is at the heart of SDG&E's arguments that the Sunrise Powerlink, a proposed 1,000-megawatt line across the desert and mountains, is needed to bring renewable energy from the Imperial Valley.

Meanwhile, the company behind the technology says it might not build its plant if Sunrise isn't approved because it won't have a way to sell its power.

Those issues and others will be on the table Thursday, when the California Public Utilities Commission is expected to decide whether Sunrise gets built and whether it should put any conditions on the line's construction.

For most people, the idea of solar power brings to mind flat photovoltaic cells that convert sunlight into electricity. This project is different. It would rely on the sun's heat to run thousands of engines, which would drive generators to create electricity.

The engine that Stirling Energy Systems of Phoenix is counting on for its contract with SDG&E was invented in 1816 by a Scottish minister, Robert Stirling, as a safer alternative to the steam engine.

Other companies have adapted it to run on heat from the sun, but none has made it work on this scale.

Stirling proposes to build 30,000 mirrored dishes, each 40 feet wide and 38 feet tall, to focus sunlight onto engines smaller than a lawn mower's, heating parts of them to more than 1,300 degrees Fahrenheit.

Inside the sealed engine, hydrogen would expand under that intense heat and drive a piston, then move to a shaded area where, cooled by desert air, it would contract and drive another piston.

The engine in each dish would produce about 25,000 watts. Together, thousands of them covering three square miles in the Imperial Valley would produce more power than a large natural-gas-fired plant.

Stirling has six prototype engines mounted on dishes and producing energy at Sandia National Laboratories in Albuquerque, N.M., where engineers are working on modifications to increase the amount of solar energy they convert to electricity.

The effort appears to be working. Popular Mechanics honored the project in October for converting 31 percent of the solar energy that hit its mirrors into electricity – more than any other system has ever done.

But 12-year-old Stirling has had trouble turning the lab work into commercial success.

“There's been a lot of words, but there has not been a lot of action,” said Steven Cowman, who took over as chief executive of Stirling in April, when Irish conglomerate NTR bought a controlling stake from initial investors for $100 million. “We're trying to fix that.”

NTR is planning to put another $100 million into Stirling in the next year, and will reverse the problems it faced before it was funded, when promises to vendors and suppliers were not kept, Cowman said.

Stirling plans to have Linamar, a Canadian automotive products company, produce its first engine in mid-January, test it, then enter full production by the end of next year.

To meet its contract with SDG&E, Stirling will have to put thousands of engines on the desert floor by the end of 2010.

Environmentalists like the concept of solar energy but aren't sure Stirling is up to producing the engines.

“They have something that, under every test out there, has failed commercially, and they're ready to skip the pilot study to go to the large scale,” said Steven Siegel, a lawyer for the Center for Biological Diversity and the Sierra Club. “That causes some concerns.”

Cowman has heard those criticisms.

“The technology has been around so long,” he parrots the complaints. “If nobody has done it in 150 years, what makes you think you can make it?”

Money and technology, Cowman said.

“The concept has been around a long time; modern manufacturing technologies have not,” he said. “We believe the manufacturing technologies now exist to make it at volume.”

The engine's design also has changed significantly over the years.

One who believes in the promise of the Stirling engine is engineer Larry Butler. He ran a solar program for SAIC, which gave up in 2002 when it couldn't make the technology cost-effective.

Like Stirling, he went to the automotive industry for help.

“We hooked up with a whole lot of guys who knew a lot about engines,” Butler said. “They just couldn't make a reliable Stirling engine.”

The tolerances needed for a engine that operates on hydrogen and has no oil are much smaller than those for gasoline or diesel, Butler said.

But Butler believes the technology will work. When he retired, he bought the technology he'd been working on and now is working with a Washington state company on engines about one-tenth the size of Stirling's.

Butler said that with enough time and money, Stirling could make a go of it, but not now.

“It's real far-fetched to think you can go from where they are to where they want to be in one shot,” Butler said.

He wrote a criticism of the Stirling proposal on behalf of the environmental groups in the Sunrise proceedings before the PUC.

The viability of Stirling's proposal is part of the discussion over the massive power line because SDG&E says it needs a way to get the power from the Imperial Valley to San Diego.

Stirling has a contract to provide 300 megawatts to SDG&E by the end of 2010, and an additional 600 megawatts once Sunrise is built. It has said it might not build the full project because of environmental concerns.

The contract is SDG&E's single largest renewable commitment.

Depending on how much power it generates and how much additional renewable power SDG&E gets from other sources, the Stirling project would provide 15 percent to 49 percent of the renewable electricity SDG&E will get in the next few years.

The utility is under pressure to meet a state requirement to get 20 percent of its power from renewable sources by 2010, though it concedes it probably will not succeed.

Siegel and other opponents of Sunrise say SDG&E is using the Stirling contract as a smoke screen to promote the line as needed to bring in renewable energy.

If Stirling can't perform, the line will be used for fossil-fuel-generated electricity, critics say.

SDG&E has responded by pledging to replace any contracts for energy from renewable sources with similar sources, including other solar, wind or geothermal producers, in the Imperial Valley.

Utility spokeswoman Jennifer Briscoe said the company is confident Stirling will perform.

She said that the contract was reviewed by state regulators and that Stirling has met all the milestones SDG&E asked for.

Briscoe said the company makes its decisions with one thing its mind.

“We're the ones with the responsibility to make sure we keep the lights on,” she said, noting that the company is looking to sign contracts for more renewable electricity.

Stirling's Cowman saw no problem with that.

“It would be imprudent of them if they didn't have a Plan B,” he said.